Sentencing guidelines - fine times ahead for bad PR

Feb.11.2010

The Sentencing Guidelines Council (SGC), the body that sets sentencing bands for criminal offences, has recently issued the definitive guidelines for Corporate Manslaughter and Health and Safety offences causing death.

The guidelines only relate to organisations, not individuals, and take effect from next Monday, 15 February 2010. They will apply to cases that appear before the courts after 15 February, even if the incident occurred a number of months or even years ago. The provisions relating to publicity orders, however, apply only to offences committed after this date.

The criminal law was historically developed before widespread corporate activity, and therefore these guidelines are long awaited. Some commentators believe that these guidelines are likely to be models for sentencing in other corporate failings in the future, and therefore their development and implementation should be carefully monitored - we will, of course, keep our readers updated.

The guidelines state that the normal approach to sentencing should be for the court initially to consider how far serious injury was a foreseeable consequence of the company's conduct and whether breaches of rules were widespread in the organisation. Thereafter, the guidelines offer a shopping list of matters for the court to consider (including a review of the various aggravating or mitigating factors that the court must have regard to in terms of how serious the offence is and the overall size and financial status of the defendant company). All of these matters must be considered before coming to a final figure.

The guidelines recommend a starting point of £500,000 for corporate manslaughter cases and £100,000 for deaths arising from health and safety law breaches.

However, the guidelines state that a fixed correlation between the fine and either turnover or profit is not appropriate. When deciding on fines, the court should not be influenced by the impact on shareholders and directors. It is clear, the guidelines intend that punitive and significant fines should be imposed both to deter and to reflect public concern at avoidable loss of life.

In almost all cases, businesses will also be forced to publish statements about their conviction for corporate manslaughter, including details of the offence and the fine. Such an order should "ordinarily be imposed …the object is deterrence and punishment". It is important to note that, as the law presently stands, no such orders can be made in respect of health and safety offences causing death.

The guidelines clearly signal that a Judge should indicate the size and content of advertisements, highlighting the punishment. For the first time the management of adverse publicity will be out of the hands of skillful PR consultants and, as such, businesses should factor in the cost of adverse publicity.

These guidelines mean that more than ever a strong health and safety culture should be fostered - it is as strategically vital as dealing with any other business risk, and should most definitely feature high on any compliance program.